China’s domestic ecosystem is improving, but it remains constrained by several hard bottlenecks, especially in photolithography equipment and memory production.
This post provides an overview of domestic Chinese AI chip making, from design to manufacturing to packaging, explaining key terms and concepts as they come up. The Chinese government has for many years given top priority to, and invested heavily in, self-sufficiency in advanced chipmaking. Since the US bars Chinese companies from buying advanced AI chips, much of China’s compute in the coming years is likely to come from domestic chips. So China’s progress in making these chips matters to anyone trying to make sense of the US-China competition and Chinese AI progress.
In short, China remains heavily constrained by export controls across the AI chip supply chain, and is many years away from making globally competitive AI chips indigenously. Huawei is China’s leading AI chip designer, followed by Cambricon, Alibaba’s T-Head, Baidu’s Kunlunxin, and several startups that ship only modest amounts of chips. On paper, the best Chinese chips remain closer to the hardware NVIDIA released about five years ago than to its current frontier. But beyond the hardware, another important gap is the software that runs on the chips. NVIDIA’s software ecosystem remains much more mature than Chinese alternatives, and for this and other reasons, Chinese developers continue to prefer NVIDIA for training workloads.
China is unable to fabricate both logic and memory chips at the quality and volume it needs. Because of their lack of access to the most advanced photolithography machines—both extreme ultraviolet (EUV) and, to a large extent, immersion deep ultraviolet (DUV)—Chinese companies struggle to produce competitive, economically viable chips. China’s fabrication process for logic chips is three to five years behind the world’s most advanced foundry, TSMC. Similarly, China’s leading memory company, CXMT, remains three to four years behind the global leaders. China’s domestic photolithography efforts are reported to have partially produced EUV prototypes, but these are most likely far from reliable or fully functional tools.
The paper was originally published by The Substrate.
